Having said that, the Fed still seems not to have managed to stick the expected date of the first rate rises in place; as good news has come rolling in, fed fund futures have signaled expectations of ever earlier increases though they may be responding less now to such strong economic data than they would have prior to the September analysis.And finally, a word on something a bit different.
But the Fed has signaled that it is loath to trim its fed fund target, which would increase inflationary pressures.
Investors are betting that the Fed will cut its benchmark fed funds rate to 1percentt, from 1.5percentt.
And in the regular meeting of mid-September, they did cut the fed funds rate — by a hefty half-point.
It is widely expected to lower its key fed funds rate by at least a quarter- point.
The committee also consults academic formulas that derive the theoretically "correct" fed funds rate according to the level of inflation and other economic indicators.
The Fed's action represents a widening of the spread between the discount rate and the upper end of the target fed funds rate.
Outside the normal schedule of its meetings, the Federal Reserve cut the fed funds rate by half a percentage point, to 6%.
But Mr. Bernanke said that slashing that rate even to zero might do no more than lower the fed funds rate by another 0.10 to 0.15 percentage points.
Since December of 2008, when the Fed cut the fed funds rate target to roughly zero, the FOMC has been scrapping to try and boost recovery without its favoured tool.
The Fed cut the fed funds rate, its main short-term rate, by half a percentage point, to 4.75percentt, on Tuesday, and stocks rocketed upward in the United States and most markets overseas.
